Stockton looking to save downtown diamonds in rough

Monday

Jun 2, 2014 at 12:01 AM

STOCKTON - Not for the first time, the city is looking for buyers interested in refurbishing and adapting three century-old, single-resident occupancy hotels that were condemned years ago and have been a blight on downtown since.

Roger Phillips

STOCKTON - Not for the first time, the city is looking for buyers interested in refurbishing and adapting three century-old, single-resident occupancy hotels that were condemned years ago and have been a blight on downtown since.

Stockton is accepting proposals from potential bidders through July 11 for developers interested in fixing up the Commercial and Main hotels in the 400 block of East Main Street and the St. Leo nearby on California Street. The city will host a tour of the sites June 10.

"We want to put it out there for developers to let us know what they envision," said Micah Runner, Stockton's director of economic development. "It's got to be a market-rate, viable transaction. There aren't city dollars to put into those hotels. We're interested in seeing what kind of market exists for them."

The three properties are among seven long-abandoned downtown hotels; the Land, Terry, Earle and La Verta are the others. The Land was demolished two years ago, and the other three are still standing. Years ago, preservationists fought to prevent demolition of the hotels.

Runner acknowledged the three hotels the city is marketing are badly run-down, perhaps nearly as badly run-down as the Land was when it was brought down. When the Land was being demolished in 2012, one worker who went inside said the scene was horrific: dead rats, pigeons flying around, rotting wood.

Mahala Burns of the Cort Cos. development firm said her understanding is that the Commercial, Main and St. Leo are in similarly poor condition. Burns called it "good news" that the city is actively marketing them, even if it is unsuccessful in finding buyers.

"If these can be developed, let's develop them," said Burns, adding that Cort is not interested. "If we find they can't be developed, if we don't get any takers, at least we'll know. Then we can move on to the next step, whatever that is."

Runner said the city is hoping one or more buyers will be interested in restoring the buildings and adapting them for residential or commercial use.

"I think you're seeing in Sacramento that projects like this are moving forward right now," Runner said. "There have been projects like this also in the Bay Area and other areas. We're curious to see whether this market exists in Stockton."

Past efforts to unload the properties were unsuccessful.

"Fifteen years ago, the city was offering a subsidy to take these buildings," Burns said. "Nobody took them. Then they were available for a dollar. Nobody took them. Now they're going to be sold at market rate. I don't expect there to be a great many takers."

Still, it would take only one. The Terry is undergoing initial renovation, though its intended eventual use is uncertain. The city gave up the Terry, which is on American Street, in a Chapter 9 bankruptcy settlement. The Terry subsequently was purchased by a private investor.

Later this year, once it exits bankruptcy as expected, Stockton plans to move its City Hall operations into the former Washington Mutual building, which is across Main Street from the Commercial and Main hotels. Burns said one way or another, the city needs to deal with its rotting reminders of blight, especially those within view of where Stockton conducts its business.

"Get rid of them or get them developed," she said. "But don't let them remain as blight. We need to make a decision. Either fix them up or tear them down. But get rid of the blight."

Contact reporter Roger Phillips at (209) 546-8299 or rphillips@recordnet.com. Follow him at recordnet.com/phillipsblog and on Twitter @rphillipsblog.